Stock Market

Why Is The Stock Market Down Today?


Stock Market Crash

Sensex market crash, Dalal Street volatility, Nifty50 correction, profit booking in Indian markets, Geojit VK Vijayakumar comment, India Pakistan ceasefire effect, US-China tariff rollback, Indian IT sector outlook, pharma sector pressure, stock market short covering

Indian equity markets opened with steep losses on Tuesday, just a day after a euphoric rally, as investors resorted to aggressive profit-taking, triggering extreme intraday volatility. The BSE Sensex plunged 902.68 points to 81,527.22, while the NSE Nifty50 slipped 229.60 points to 24,713.60 during early trade before staging a partial recovery.

The sharp swings reflect uncertainty in investor sentiment, following Monday’s rally driven by easing geopolitical tensions and a sovereign credit rating upgrade. However, experts believe much of the optimism had already been priced in, leaving room for sell-offs and short-term choppiness. “It seems that stock markets are facing extreme volatility today and the trend may continue throughout the trading session,” a market expert observed.

By mid-morning, the Sensex had pared losses to around 400 points, with the Nifty recovering similarly, buoyed by dip-buyers entering the fray. Nonetheless, the tone remained cautious, with mixed signals across Nifty sectoral indices, indicating broader market hesitancy.

Why the Volatility?

The rally on Monday was primarily driven by short-covering, retail inflows, and optimism over the India-Pakistan temporary ceasefire and a 90-day tariff rollback between the US and China, both of which provided relief to jittery investors. However, Tuesday’s session saw traders cashing in on gains amid a lack of further immediate positive triggers. “FII and DII net buying was only Rs 2,694 crore, indicating the 916-point Nifty rally wasn’t institution-led,” said Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.“This lack of institutional momentum could limit further upside.”

The narrow institutional participation raises concerns about sustainability, especially in the absence of fresh macroeconomic tailwinds.

What Next for Investors?

Despite Tuesday’s volatility, analysts continue to hold a constructive medium-term outlook, especially with improved global trade sentiment and stabilising regional geopolitics. The Indian IT sector is seen as a potential outperformer in the near term, supported by a resilient US economic backdrop.

However, pharmaceutical exporters could face headwinds due to pricing pressures linked to former US President Donald Trump’s drug price control order, which is once again being debated under the current administration.

Market experts advise retail investors to remain optimistic but disciplined, avoiding the temptation to chase rallies and instead keeping a close eye on global triggers and institutional flow patterns.

“Stay invested, but avoid knee-jerk reactions. There’s still strength in the fundamentals,” added a fund manager from a leading domestic AMC.





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